CHART OF THE DAY: The Simple Reason Stocks Have Had Such An Incredible Two Years

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Today is the 2-year anniversary of the March, 2009 bottom.

Why have stocks been on such a monster tear since then?

It’s not that complicated, really.

The v-shaped recovery in equities is closely echoed by the v-shaped recovery in earnings, as this chart from Citi’s Tobias Levkovich confirms. If earnings continue on their current trajectory, or something close to it, watch for stocks to follow.

chart of the day, s&p 500, eps, march 2011

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